WASHINGTON (Reuters) - U.S. President Donald Trump on Thursday threatened to slap a 200% tariff on wine, cognac and other alcohol imports from Europe, opening a new front in a global trade war that has roiled financial markets and raised recession fears.

Stocks fell on the news, as investors worried that Trump would enact stiffer trade barriers around the world's largest consumer market.

"The Entire World is RIPPING US OFF!!!" Trump wrote on his Truth Social platform.

Trump's threat came in response to a European Union plan to impose tariffs on American whiskey and other products next month -- which itself is a response to Trump's 25% tariffs on steel and aluminum imports that took effect on Wednesday. The European Commission had no immediate comment on Trump's post.

Canada, a neighbor and close ally that is the U.S.' biggest aluminum provider, has also announced countermeasures of its own to Trump's metals tariffs.

Alcohol is shaping up to be a key friction point in the trade war Trump has launched since returning to the White House in January.

Some Canadian retailers have pulled American bourbon from their shelves as relations between the two countries have frayed and Trump has threatened to annex that country.

Many of the EU's proposed countermeasures, worth 26 billion euros ($28.31 billion) in all, would apply to products that have little more than symbolic value, such as dental floss and bathrobes.

But the proposed 50% duty on U.S. bourbon would be a significant hit for the industry, which has seen exports grow steadily since the United States lifted tariffs Trump imposed during his first 2017-2021 term in office.

The EU accounted for roughly 40% of all spirits exports in 2023, according to the Distilled Spirits Council of the United States, a trade group.

Likewise, the United States accounts for one-third of EU wine and spirits exports, according to Eurostat.

Industry officials on both sides of the Atlantic urged their leaders to de-escalate.

"This cycle of tit-for-tat retaliation must end now!" said spiritsEurope, an industry trade group.

Trump's proposed 200% tax on European alcohol poses a pointed threat to luxury goods giant LVMH,, whose brands include Moët & Chandon champagne and Hennessy cognac. Founder Bernard Arnault has known Trump for decades and had a prominent seat at his inauguration in January. The company did not immediately respond to a request for comment.

Trump said it would benefit U.S. producers, echoing his argument that his metals tariffs will revive U.S. production.

But his barrage of threats has spooked investors, businesses and consumers. Producers of jets, coffee, clothing, autos and packaged foods are among the many businesses scrambling to assess their operations as Trump's actions threaten international supply chains.

Some economists say the uncertainty threatens the health of the U.S. economy and raises the risk of recession. A Reuters/Ipsos poll released on Wednesday found that 70% of Americans expect Trump's tariffs to lead to higher prices.

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